Our primary goal is to identify and define the actions of proteins that can be used to repair tissues or structures that have been damaged by trauma, neoplasia, or other pathology. We have identified over a dozen novel proteins. Two of these induce the formation of cartilage, one induces the formation of bone and hematopoietic tissue, one plays a key role in defining the overall pattern of the developing embryo, and thr others have unknown functions. One of these proteins, Frzb, is a secreted inhibitor of signaling by the Wnt growth factor oncogenes, and is the prototype of a growing family of related proteins. Key feedback interactions between secreted growth factors belonging to the Wnt and Bone Morphogenetic Protein (BMP) families and secreted antagonists of these proteins were elucidated. Localized expression of BMPs 4&7, Wnt-8, the BMP antagonists chordin and noggin, and the Wnt antagonist Frzb were found to establish the morphogenetic field giving rise to the earliest precursors of vertebrate muscle. The relationship of expression pattern of these proteins appears to maintain a dynamic balance between Wnt-8 and BMPs 4&7 pathways that controls tissue fate. The dbl oncogene was found to be expressed in a complex pattern within the developing central nervous system, suggesting that this guanine nucleotide exchange protein may have specific functions in neural differentiation. Several novel genes were identified, including a possible homologue of mammalian thymopoietin that begins to be expressed during gastrulation.